• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Malaysian crude palm oil futures ended sharply higher lifted by a rise in soya oil futures and expectations of steady exports. Supply concerns and dwindling palm oil reserves are underpinning prices.

CPO active August contract rose sharply higher. As mentioned earlier, further up side can be seen towards 2465-80 Malaysian ringgit (MYR) tonne levels. But, there are still highly overbought indications. Still one needs to be wary of a strong pullback. Soya oil futures too are indicating limited up side from current levels. Going back to 2001, there was a similar situation when the indicators remained overbought close to three months and the prices rallied more than 600 ringgits in the process.

A new impulse began from 1427 MYR/tonne as per the recent wave counts. We are in the fifth wave move of that impulse. We can expect a corrective A-B-C to take place in the coming weeks. RSI is in the overbought zone and has started showing negative divergences indicating a possible top in the offing. The averages in MACD are still above the zero line in the indicator suggesting bullishness to be intact.

Prices are above the short-term 8-day period EMA at 2298 MYR/ton and the 21-day period EMA is at 2188 MYR/ton. Therefore look for palm oil futures to test the resistance levels and then correct lower sharply.

Supports are at MYR 2350, 2278 and 2240. Resistances are at MYR 2400,2452 and 2495.

(The author is the Director of Commtrendz Research and also in the advisory panel of Multi Commodity Exchange of India Ltd (MCX). The views expressed in this column are his own and not that of MCX. This analysis is based on the historical price movements and there is risk of loss in trading. He can be reached at gnanasekar_thiagarajan@yahoo.com.)

Gnanasekar. T

More Stories on : Technical Analysis | Oilseeds & Edible Oil

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Spot rubber gains from speculation

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line